Coordination of benefits (COB) is a method used to determine which insurance company (i.e., payer) is primarily responsible for payment when an individual is covered under more than one insurance plan. COB may also be used to help ensure that an insurance claim is not paid multiple times, for example, by multiple payers, when an individual is insured under multiple insurance plans. In healthcare, individuals may be covered by multiple insurance plans, for example, when two partners both receive healthcare benefits through their jobs, and their benefits are expanded to their spouses or domestic partners, and to their children if dependents are automatically covered. As a result, each partner (and children if applicable) may be covered by two health insurance plans.
Oftentimes, there may be guidelines that regulate how claims are processed relative to multiple coverages. For example, if a married couple is covered by two health insurance plans, the husband's insurance plan may be primary coverage for him, while his spouse's insurance plan may be primary coverage for her. However, if one person has insurance coverage through a government-subsidized payer (e.g., Medicaid or Veterans Affairs (VA)) and the spouse has insurance coverage through an employer, then the spouse's insurance coverage through the employer may be primary coverage for both. As another example, typically, if a child is covered by both parents' health insurance plans, a “birthday rule” may be user, wherein the health insurance provider (i.e., payer) of the parent whose birthday falls first in a calendar year may be determined to be the primary health insurance provider of the child. As can be appreciated, there may be exceptions to the “birthday rule,” as well as other rules for determining primary coverage.
Currently, if an individual receives a healthcare service from a healthcare service provider, and the individual has multiple coverages (i.e., is covered under more than one health insurance plan), the healthcare provider may not know which health insurance plan carrier (i.e., payer) is primary or secondary and to which payer a claim should be filed. Consider, for example, a child who is covered under two different healthcare insurance policies is injured and goes to a hospital for treatment. One policy may be under his mother and the other one may be under his father. Even if both parents are present and they both have their insurance cards, the hospital may not know to which insurance company to submit the claim. In many cases, the healthcare provider may submit a claim to both payers. Most of the time, one of the insurance companies (i.e., payers) may pay. In some instances both the insurance companies may pay, which can lead to wasted administrative and accounting work and costs. For example, one payer may later determine they are secondary and may request to be reimbursed for the payment made. In other cases, neither payer may pay, both denying the claims until they receive a document that says the individual does not have a COB instance (i.e., the individual does not have multiple health insurance coverages).
Current COB methods may cause administration challenges that can add cost and increased workloads to departments within an insurer's operation. For example, current COB methods may cause service workarounds, claim delays, rework, phone calls, recovery fees, and administrative costs in a search for which individuals may have duplicate coverage and for which payer may be primary and which payer may be secondary. It is with respect to these and other considerations that the present invention has been made.